Monday, 20th July, 2015, U.S President Barack Obama will finally welcome his Nigerian counterpart, President Muhammadu Buhari, to the White House after lauding the success of the elections that brought the latter to power in May. “The visit will mark our support for the Nigerian people following their historic democratic elections and peaceful transfer of power,” read a statement from the White House. But for President Buhari, this visit provides him with the opportunity to seek some governance advice, and seal agreements needed to jump start his two-month-old government.
President Buhari has already hinted at his agenda with one of the top items being the need for support to tackle corruption. While this move is laudable given Nigeria’s massive corruption problem, the president should prioritize three challenges — combating Boko Haram, improving power, and growing exports. Here is why:
Combating Boko Haram
Since President Buhari assumed office in in late May, Boko Haram has scaled up its operations, killing over 700 people in less than 60 days. This is despite the president’s efforts to solidify the on-going regional coalition against the insurgency which killed over 15,000 people in the last five years, rendered more than a million homeless, and grounded northeastern Nigeria’s economy.
The U.S. has been at the forefront of the fight against terror groups, including al Qaeda and ISIS, in the Middle East. Seeking support for Nigeria’s military and anti-terrorism operations, largely through intelligence coordination and weapons supply, should dominate Buhari’s discussions with Obama.
Over the last 50 years, Nigeria has spent billions of dollars, signed multiple contracts and consulted numerous foreign experts. Still the country has not been able to solve its power problem. The national grid is in disrepair and regular blackouts are commonplace.
Power has improved lately, climbing to 4,500MW, from a low of 1,400MW just before President Buhari assumed office on May 29, 2015. This is barely enough to meet the energy needs of 170 million people and the growing number of industries developing in the country’s major commercial cities. Experts say Nigeria needs about 20,000MW to effectively power its homes and businesses.
President Obama’s $7 billion Power Africa Initiative, announced during his 2013 trip to southern Africa, and the subsequent multi-billion dollar investment by General Electric aimed at ramping up power infrastructure within Nigeria offers hope for a brighter future. As Nigeria consolidates its position as Africa’s largest economy, President Buhari should push for greater collaboration with the US, particularly in exploring alternative energy resources.
Nigeria is an import-driven economy. Crude oil remains the single, most important export commodity, accounting for more than 75 percent of government revenue. Unfortunately, the lingering global crisis has halved revenue from oil exports impacting everything from the Naira — Dollar exchange rate and the capital market which last lost more than 30 percent of its value during the same period.
As export revenues from oil continue to dwindle, Nigeria has fewer dollar reserves to pay for imports. The country needs to shore up its exports by finding new markets, particularly from a revived agricultural sector and its natural gas reserves.
Securing long term sale agreements with the US, or its allies, will help boost export revenue and grow its foreign reserves.